Attached files
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| 8-K - TITANIUM METALS CORPORATION FORM 8K - Q3 2009 - TITANIUM METALS CORP | form_8k.htm |
Exhibit 99.1
PRESS
RELEASE
| FOR IMMEDIATE RELEASE: | CONTACT: |
| Titanium Metals Corporation | John A. St. Wrba |
| 5430 LBJ Freeway, Suite 1700 | Vice President and Treasurer |
| Dallas, Texas 75240 | (972) 233-1700 |
TIMET REPORTS THIRD QUARTER
2009 RESULTS
DALLAS, TEXAS . . . November 5, 2009 .
. . Titanium Metals Corporation (“TIMET” or the “Company”) (NYSE: TIE) reported
net income attributable to common stockholders of $1.1 million, or $0.01 per
diluted share, for the quarter ended September 30, 2009, compared to $40.2
million, or $0.22 per diluted share, for the quarter ended September 30,
2008.
The
Company’s net sales were $181.4 million for the third quarter of 2009 compared
to $295.4 million for the third quarter of 2008, a decrease of 39% principally
resulting from lower volumes and average selling prices. Product
shipment volumes have decreased as overall titanium demand remains low due to
the weak global economy and production delays within the commercial aerospace
sector. Additionally, as a result of these production delays, the
Company believes many of its commercial aerospace customers have implemented
strategies to reduce excess inventories and to maximize operating cash
flows. Average selling prices are lower due to competitive pricing
pressures resulting from lower demand for titanium products and a decline in raw
material costs, primarily titanium scrap. The decline in raw material
costs has contributed to lower selling prices for certain products under
long-term customer agreements, in part due to raw material indexed pricing
adjustments included in certain of these agreements.
Operating
income of $3.5 million for the third quarter of 2009 decreased from $52.9
million for the same period in 2008, primarily reflecting the effects of lower
volumes and average selling prices for melted and mill products. Due
to low utilization of our production capacity, the favorable impacts on our
gross margin from declining raw material costs, primarily titanium scrap, were
largely offset by higher per-unit overhead costs as well as unabsorbed overhead
resulting from abnormally low production throughout our major manufacturing
operations.
Bobby D.
O’Brien, President, said, “While near-term demand outlook remains unclear,
Boeing has recently announced an expected first flight for the Boeing 787 prior
to the end of 2009 and first commercial delivery during the fourth quarter of
2010. Achievement of these milestones could mark the beginning of a
period of growth in production rates throughout the commercial aerospace supply
chain. Overall industry outlook continues to support a long-term
favorable trend in demand for titanium products. We continue to
emphasize cost control initiatives and operational flexibility in this
environment while maintaining positive cash flow with no indebtedness and cash
and borrowing availability under our bank credit agreements of approximately
$360 million.”
The statements contained in this
release that are not historical fact are forward-looking statements that
represent TIMET management’s beliefs and assumptions based on currently
available information. Forward-looking statements can generally be
identified by the use of words such as “believes,” “intends,” “may,” “will,”
“looks,” “should,” “could,” “anticipates,” “expects” or comparable terminology
or by discussions of strategies or trends. Although TIMET believes
that the expectations reflected in such forward-looking statements are
reasonable, it does not know if these expectations will prove to be
correct. Such statements by their nature involve substantial risks
and uncertainties that could significantly affect expected
results. Actual future results could differ materially from those
described in such forward-looking statements, and TIMET disclaims any intention
or obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Among the
factors that could cause actual results to differ materially are the risks and
uncertainties discussed in this release, including risks and uncertainties in
those portions referenced above and those described from time to time in our
other filings with the SEC which include, but are not limited to:
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the cyclicality of the
commercial aerospace
industry;
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the performance of aerospace
manufacturers and TIMET under long-term
agreements;
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·
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the existence or renewal of
certain long-term
agreements;
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·
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the difficulty in forecasting
demand for titanium
products;
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global economic and political
conditions;
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·
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global production capacity for
titanium;
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·
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changes in product pricing and
costs;
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·
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the impact of long-term
contracts with vendors on TIMET’s ability to reduce or increase
supply;
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·
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the possibility of labor
disruptions;
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·
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fluctuations in currency
exchange rates;
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·
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fluctuations in the market
price of marketable
securities;
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uncertainties associated with
new product or new market
development;
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the availability of raw
materials and services;
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changes in raw material prices
and other operating costs (including energy
costs);
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possible disruption of
business or increases in the cost of doing business resulting from
terrorist activities or global
conflicts;
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competitive products and
strategies; and
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other risks and
uncertainties.
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Should one or more of these risks
materialize (or the consequences of such a development worsen), or should the
underlying assumptions prove incorrect, actual results could differ materially
from those forecasted or expected.
TIMET, headquartered in Dallas, Texas,
is a leading worldwide producer of titanium metal
products. Information on TIMET is available on its website at www.timet.com.
· · · · ·
TITANIUM
METALS CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
(In
millions, except per share and product shipment data)
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Three
months ended
September
30,
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Nine
months ended
September
30,
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2008
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2009
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2008
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2009
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(Unaudited)
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Net
sales
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$ | 295.4 | $ | 181.4 | $ | 886.3 | $ | 590.5 | ||||||||
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Cost
of sales
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222.5 | 163.7 | 648.0 | 501.8 | ||||||||||||
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Gross margin
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72.9 | 17.7 | 238.3 | 88.7 | ||||||||||||
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Selling,
general, administrative and development
expense
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18.0 | 14.2 | 51.5 | 44.8 | ||||||||||||
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Other
(expense) income, net
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(2.0 | ) | - | (2.3 | ) | 1.7 | ||||||||||
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Operating income
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52.9 | 3.5 | 184.5 | 45.6 | ||||||||||||
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Other
non-operating income, net
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4.8 | - | 3.3 | 0.5 | ||||||||||||
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Income before income
taxes
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57.7 | 3.5 | 187.8 | 46.1 | ||||||||||||
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Provision
for income taxes
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16.1 | 2.4 | 54.9 | 15.2 | ||||||||||||
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Net income
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41.6 | 1.1 | 132.9 | 30.9 | ||||||||||||
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Noncontrolling
interest in net income (loss) of subsidiary
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1.3 | (0.1 | ) | 4.9 | 1.3 | |||||||||||
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Net income attributable to
TIMET
stockholders
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40.3 | 1.2 | 128.0 | 29.6 | ||||||||||||
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Dividends
on Series A Preferred Stock
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0.1 | 0.1 | 0.2 | 0.2 | ||||||||||||
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Net income attributable to
TIMET
common stockholders
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$ | 40.2 | $ | 1.1 | $ | 127.8 | $ | 29.4 | ||||||||
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Earnings
per share attributable to TIMET
common stockholders
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$ | 0.22 | $ | 0.01 | $ | 0.70 | $ | 0.16 | ||||||||
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Weighted
average shares outstanding:
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Basic
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181.0 | 180.6 | 181.6 | 180.9 | ||||||||||||
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Diluted
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182.0 | 180.6 | 182.6 | 180.9 | ||||||||||||
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Melted
product shipments:
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Volume (metric
tons)
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1,115 | 675 | 3,060 | 1,915 | ||||||||||||
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Average selling price (per
kilogram)
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$ | 29.85 | $ | 23.90 | $ | 30.90 | $ | 26.65 | ||||||||
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Mill
product shipments:
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Volume (metric
tons)
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3,845 | 2,665 | 11,195 | 8,775 | ||||||||||||
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Average selling price (per
kilogram)
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$ | 59.40 | $ | 56.00 | $ | 61.95 | $ | 55.40 | ||||||||